ExxonMobil’s claims US$2.1B in administrative costs in 2016 alone

…fails to provide any breakdown- Ram notesBy Abena Rockcliffe-CampbellEsso Exploration and Production Guyana Limited (EEPGL), a subsidiary of ExxonMobil, has recorded administrative costs of just over US$2.1B for 2016 alone. This was reflected in EEPGL’s 2016 financial statement.Chartered Accountant and Attorney-at-law, Christopher Ram, is in possession of the company’s financial statements.He noted that while EEPGL registered that it spent over US$2.1B for administration purposes, there has been no breakdown of how this money was spent except for the company saying that $168M was spent on legal and professional fees.Ram pointed this out in recent writings. He noted that the total debt of Esso in 2016 was $76.8B of which approximately US$60B was incurred in 2016.All the money that EEPGL used was secured via loans from ExxonMobil, which is EEPGL’s parent company. The loans carry an interest, which Guyana has agreed to pay.While the contract states clearly that Guyana will pay interest on all loans secured by the company, Ram said, “We do not and cannot know (about the interest on these sums) because of the sparse information offered in the financial statements.“Here is what those statements say about intercompany debt: This amount represents amount due to Home Office as well as intercompany loan utilized to fund petroleum operations.”Ram said that Guyanese are left to only speculate whether the interest cost is included in the sums presented in the financial statement or if it will be added later.He said, “There is no breakdown of this huge amount. One will have to speculate whether or not any interest cost is included in this amount.”Many cases have been pointed out around the world where oil companies pad their expenses to reflect higher borrowings from their parent company. The higher the sum borrowed the more accumulated interest would have to be repaid to the parent company through cost recovery.Guyana has agreed to pay all interest secured as long as the rate is “internationally competitive.” However, the country has not put any restrictions on the amount of money that can be borrowed.The International Monetary Fund (IMF), in 2017, did a review of the Production Sharing Agreement (PSA) that Guyana and EEPGL share.IMF then prepared a report, which it submitted to the Government of Guyana. The report, in this newspaper’s possession, is titled, “A Reform Agenda for Petroleum Taxation and Revenue Management.”In that report, IMF said that the “the treatment of interest expenses appears to be generous.”IMF said too that the treatment of interest expenses “is important because excessive or abusive use of debt can have a detrimental impact on the amount of profit oil to be shared between the government and the contractor (the evaluation section below illustrates this point).”IMF reported its understanding that in Guyana’s PSAs, interest expenses, irrespective of the source of financing, are permitted to be recovered if such expenses are consistent with market rates. Moreover, interest payments are exempt from withholding taxes, providing yet another incentive for contractors to finance their costs with debt.The IMF also noted that it is common to have limitations on interest deductibility to reasonably protect the tax base. Some countries disallow interest expenses or limit the amount of debt permitted for cost recovery purposes through caps on debt to equity ratios or earning stripping rules.Other countries may prescribe that interest may be deductible only on borrowing to fund development costs or a maximum percentage of such costs. An example is Uganda’s model PSA, which allows interest on loans (from any source) to finance development operations only up to 50 percent of the total financing requirement.

We have a sloppy government and still we are barely bypassing this for the entire nation! This is how the oil business stay dominant even in war torn regions of the planet and why they actively seek to prohibit access to green energy. Do you know that an Exxon based initiative made adding solar to a home in Florida an administrative nightmare to actually be permitted to do the task? They even rigged elections in local communities to prevent initiatives to go green. Welcome to the corrupt world of oil. This is the first layer. The politicians have to get their cut.

"Esso Exploration and Production Guyana Limited (EEPGL), a subsidiary of ExxonMobil, has recorded administrative costs of just over US$2.1B for 2016 alone. This was reflected in EEPGL’s 2016 financial statement.Chartered Accountant and Attorney-at-law, Christopher Ram, is in possession of the company’s financial statements.He noted that while EEPGL registered that it spent over US$2.1B for administration purposes, there has been no breakdown of how this money was spent except for the company saying that $168M was spent on legal and professional fees.Ram pointed this out in recent writings. He noted that the total debt of Esso in 2016 was $76.8B of which approximately US$60B was incurred in 2016.'

Lots of confusion here with the numbers,some value quoted in $US,some no country $ value.

"Esso Exploration and Production Guyana Limited (EEPGL), a subsidiary of ExxonMobil, has recorded administrative costs of just over US$2.1B for 2016 alone. This was reflected in EEPGL’s 2016 financial statement.Chartered Accountant and Attorney-at-law, Christopher Ram, is in possession of the company’s financial statements.He noted that while EEPGL registered that it spent over US$2.1B for administration purposes, there has been no breakdown of how this money was spent except for the company saying that $168M was spent on legal and professional fees.Ram pointed this out in recent writings. He noted that the total debt of Esso in 2016 was $76.8B of which approximately US$60B was incurred in 2016.'

Lots of confusion here with the numbers,some value quoted in $US,some no country $ value.

What is there to believe ?

I agree. Looks like Ram forgot to put US on the total debt or maybe the 2016 number is in local currency. I think Ram is trying to point out that 79% of the total debt was incurred in 2016.

"Esso Exploration and Production Guyana Limited (EEPGL), a subsidiary of ExxonMobil, has recorded administrative costs of just over US$2.1B for 2016 alone. This was reflected in EEPGL’s 2016 financial statement.Chartered Accountant and Attorney-at-law, Christopher Ram, is in possession of the company’s financial statements.He noted that while EEPGL registered that it spent over US$2.1B for administration purposes, there has been no breakdown of how this money was spent except for the company saying that $168M was spent on legal and professional fees.Ram pointed this out in recent writings. He noted that the total debt of Esso in 2016 was $76.8B of which approximately US$60B was incurred in 2016.'

Lots of confusion here with the numbers,some value quoted in $US,some no country $ value.

What is there to believe ?

I agree. Looks like Ram forgot to put US on the total debt or maybe the 2016 number is in local currency. I think Ram is trying to point out that 79% of the total debt was incurred in 2016.

Bhai,Guyana is a funny place every one trying to score brownie points,confusing the population.

"Esso Exploration and Production Guyana Limited (EEPGL), a subsidiary of ExxonMobil, has recorded administrative costs of just over US$2.1B for 2016 alone. This was reflected in EEPGL’s 2016 financial statement.Chartered Accountant and Attorney-at-law, Christopher Ram, is in possession of the company’s financial statements.He noted that while EEPGL registered that it spent over US$2.1B for administration purposes, there has been no breakdown of how this money was spent except for the company saying that $168M was spent on legal and professional fees.Ram pointed this out in recent writings. He noted that the total debt of Esso in 2016 was $76.8B of which approximately US$60B was incurred in 2016.'

Lots of confusion here with the numbers,some value quoted in $US,some no country $ value.

What is there to believe ?

I agree. Looks like Ram forgot to put US on the total debt or maybe the 2016 number is in local currency. I think Ram is trying to point out that 79% of the total debt was incurred in 2016.

Bhai,Guyana is a funny place every one trying to score brownie points,confusing the population.

Django, you would go digging in every hole to pull the facts, since you express concern about the $ value....

Tell us what prevents you from finding the truth, same as you do for opposition MP.

If was the opposition or anything to do with Indian, you would be jumping over the moon . Your biasness is showing daily.

"Esso Exploration and Production Guyana Limited (EEPGL), a subsidiary of ExxonMobil, has recorded administrative costs of just over US$2.1B for 2016 alone. This was reflected in EEPGL’s 2016 financial statement.Chartered Accountant and Attorney-at-law, Christopher Ram, is in possession of the company’s financial statements.He noted that while EEPGL registered that it spent over US$2.1B for administration purposes, there has been no breakdown of how this money was spent except for the company saying that $168M was spent on legal and professional fees.Ram pointed this out in recent writings. He noted that the total debt of Esso in 2016 was $76.8B of which approximately US$60B was incurred in 2016.'

Lots of confusion here with the numbers,some value quoted in $US,some no country $ value.

What is there to believe ?

I agree. Looks like Ram forgot to put US on the total debt or maybe the 2016 number is in local currency. I think Ram is trying to point out that 79% of the total debt was incurred in 2016.

Bhai,Guyana is a funny place every one trying to score brownie points,confusing the population.

Django, you would go digging in every hole to pull the facts, since you express concern about the $ value....

Tell us what prevents you from finding the truth, same as you do for opposition MP.

If was the opposition or anything to do with Indian, you would be jumping over the moon . Your biasness is showing daily.

What biasness bhai,I am pointing out the confusing $$ amount.Is it the way to confuse the population ?

For awhile i can't fathom the quote of billions of $$ in the homeland.Guyana seems to be a wealthy country considering the size of the population of merely 750,000.

Yet the country is just above Haiti in the western hemisphere,all the small islands are above Guyana and their majority population is you know what kind of ethnicity.One of the reasons when you all shooting sh!t, look around the Caribbean.

"Esso Exploration and Production Guyana Limited (EEPGL), a subsidiary of ExxonMobil, has recorded administrative costs of just over US$2.1B for 2016 alone. This was reflected in EEPGL’s 2016 financial statement.Chartered Accountant and Attorney-at-law, Christopher Ram, is in possession of the company’s financial statements.He noted that while EEPGL registered that it spent over US$2.1B for administration purposes, there has been no breakdown of how this money was spent except for the company saying that $168M was spent on legal and professional fees.Ram pointed this out in recent writings. He noted that the total debt of Esso in 2016 was $76.8B of which approximately US$60B was incurred in 2016.'

Lots of confusion here with the numbers,some value quoted in $US,some no country $ value.

What is there to believe ?

He said it is their US financial disclosure so all is us denominations.

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